New Zealand Dollar Near Lows Amid Mixed Inflation Signals

The New Zealand Dollar (NZD) remains near its lowest levels as business confidence shows a notable improvement. The share of firms reporting higher costs dropped to 47% from 54%, and fewer companies increased prices, reducing concerns about inflation spreading from fuel costs. The Reserve Bank of New Zealand (RBNZ) raised its Official Cash Rate (OCR) to 2.75% in September, with traders anticipating a third hike on October 28. However, softer pricing trends may weaken these expectations.

The RBNZ Governor Breman is scheduled to speak on Thursday, with the next key event being the third-quarter Consumer Price Index (CPI) on October 21. Voters in New Zealand will head to the polls on November 7. Meanwhile, the US economic calendar includes private-sector jobs data, Federal Reserve minutes, and jobless claims later this week.

Technically, the NZD/USD pair has been declining, with resistance levels at 0.5650 and support near 0.5600. A daily close above 0.5700 could reverse the downward trend. The Stochastic Relative Strength Index (Stoch RSI) remains low, suggesting potential short-term bounces toward resistance levels.